Will the prices on real estate fall down? Russian point of view

I found a very interesting info in Moscow Times from Rustam Tariko about Russian mortgage and residential prices. Probably you know him with "Russian Standart" (Russkiy Standart) vodka brand and bank with the same name.

He won't pander to the latest aspiration of the emerging middle class -- a mortgage to buy a new home -- as long as Russians are gripped by what he calls a "crazy" property boom.

"I believe a crisis will come soon," said Tariko. "Real estate prices are very inflated."

Russky Standart Bank boasts a return on equity of over 75 percent, controls 80 percent of Russia's credit card market and employs 40,000 people.

Despite his ambitious growth plans, Tariko sees risks to Russia's eight-year economic boom, above all from the red-hot property market. But, Tariko says, too many speculators are buying. When he drives down affluent Kutuzovsky Prospekt, he sees that nobody is home in many newly built residential complexes.

"When I see the lights on in all these new buildings, I will start to invest [in mortgages]," he said. "But while the lights are out, I won't."

There is no direct linking between Russian and Ukrainian real estate markets, but I strongly sure that if the prices will down in Russia, such scenario become a reality in Ukraine. These markets connected much closer than you could imagine ever.